Healthcare cost crisis nearing zero hour

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Dec. 7 – Healthcare costs in the United States, according to Allen Lichter, MD, are quickly approaching unsustainable levels. Lichter, who delivered the annual oration in radiation oncology at the 2007 Radiological Society of North America (RSNA) scientific assembly last week, said that the healthcare cost crisis is a major issue that requires immediate action.

“It’s not whether it will happen, it’s what will happen,” he said.

Lichter, executive vice president and CEO of the American Society of Clinical Oncology, noted that the issue of rising healthcare costs in the U.S. has spawned a seemingly limitless number of proposals for dealing with the problem. For example, a recent search on the term “healthcare reform” conducted by Lichter at the online retailer Amazon resulted in 898 listings for books on the subject.

Healthcare spending in the U.S. in 1975 represented 8.1 percent of the gross domestic product (GDP), according to Lichter. By 2005, that figure doubled to 16 percent and is expected to rise to 19.2 percent of the GDP by 2015.

“To put that into perspective, consider that 20 percent of the GDP represents the entire size of federal revenues today,” he said.

The U.S. Comptroller General recently noted that, by 2030, growth in Medicare spending will be nearly three times the growth in our economy, Lichter said.

“We must recognize there is a serious problem facing us,” he said. “Without cost containment there will be major shifts in cost onto private insurance and Medicare beneficiaries.”

Private payors have already begun the process of cost shifting onto their members, mainly by raising health insurance premiums out of proportion to the incomes of those it is supposed to cover. For example, between 2001 and 2007, health insurance premiums raised an average of 78 percent, while worker earnings rose only 19 percent, he said.

Employers have reacted to this premium inflation by dropping healthcare plans for their workers. The number of firms offering health benefits has decreased from 70 percent in 2000 to 60 percent this year, Lichter said. This is leading to an increasing number of people being forced out of the system, with an estimated 47 million uninsured for healthcare in the U.S.

“It is difficult to overstate the problem of the escalating cost medical care presents to our nation,” Lichter observed. “The fallout of this trend is now being felt in every industry and business. Clearly, things will have to change.”

Although the U.S. healthcare system, as currently configured, will be economically untenable within the next 20 years, if not sooner, it has achieved some notable accomplishments, Lichter said. Its training and clinical-care set standards for medicine throughout the world, and its device and pharmaceutical industries carry out much of the advanced development in new technologies and drugs.

In addition, the U.S. does better than most other countries in cancer care outcomes, he said, as cancer death rates are falling in this country.
 
The bad news is that the rising cost of cancer care is pushing treatments out of the reach of many patients, even those with healthcare insurance.

Lichter noted that the economic burden of cancer in the U.S. is estimated to be more than $263 billion; of this, more than $78 billion is spent on direct medical costs. Although cancer care is a component of healthcare expenditures, it is not the major cause of healthcare cost inflation, he said.

“If you are uninsured with cancer, your chance of survival is far worse than insured patients,” he said. “There is a moral issue at stake here.”

Even though advances in diagnostics and treatment are clearly welcomed by both patients and providers, their cost has important implications for the individual and for society, he said.

“In oncology, we need to focus on tests and therapy making a meaningful difference, and decide when they are unnecessary,” he said. “For example, 25 percent to 35 percent of cancer patients are still receiving active therapy within two weeks of their death. Patients want hope, but they also want realistic information.”

As such, Lichter advocated that physicians talk clearly to their patients about choices, which may include both efficacy and cost considerations.

“This requires a willingness to confront tough questions, to listen and understand individual circumstances, and to guide patients and families toward the best decision,” he said. “We need to embrace our leadership role in these discussions and seek out the resources we need to be effective communicators.”

Lichter said that serious efforts at cost containment must begin now. Approximately 70 percent of current healthcare spending can be attributed to five chronic conditions: diabetes, congestive heart failure, asthma, coronary artery disease and depression, he said.

“We know how to manage these diseases in a far more cost-effective and coordinated fashion,” Licther noted.

He believes that the best management strategy is an investment in primary care and its coordination through electronic medical records.

“With primary-care physicians quarterbacking the process, we will save money and manage patients more effectively,” he said.

Lichter also called on radiologists and oncologists to form more effective partnerships to reduce healthcare costs.

“We need to design and execute the clinical trials that show which imaging and therapy modalities work in various settings,” he said. “We need to figure out what is the outcome for the patient undergoing PET scans and proton therapies. And we must continue to advocate for NIH [National Institutes of Health] research dollars. The healthcare dollars we spend should produce increasing cancer cures and that takes research.”

The shape of healthcare reform needs to be guided by strong input from physicians, according to Lichter.

“As medical professionals, we have a responsibility to be good stewards of the substantial intellectual and financial resources at our disposal,” he said. “We have the tools to be a positive force as our respective communities struggle to answer questions of cost, benefit and value.”

Although the prevention and treatment of disease is the traditional role of healthcare professionals, the oncoming healthcare cost crisis requires that they commit to staking a claim on this crucial policy issue, Lichter said.

“We should not shy away from the hard social questions/issues,” he said. “This includes our collective advocacy for a rational payment system. Strong professional commitment to a system that provides incentives for high quality, universally accessible care is needed.”